Nationwide and Annexus are teaming up to promote in-plan annuities to employer-sponsored retirement plans.
The companies have joined with Capital Group — the parent of American Funds — to introduce the NCIT American Funds Lifetime Income Builder Target Date Series funds.
The new TDF Series funds come with participant access to a built-in group nonvariable indexed annuity.
The funds in the new TDF Series fund family are structured as investment options provided by a bank-sponsored collective investment trusts, rather than as mutual funds.
The Law
Nationwide, Annexus and Capital Group companies are working to make practical use of features in the Setting Every Community Up for Retirement Enhancement Act of 2019.
Some Secure Act provisions could make in-plan annuities more attractive to sponsors of 401(k) plans and other defined contribution plans.
An in-plan annuitization feature can offer a worker a way to convert a pile of retirement savings into a stream of benefits that could last a lifetime.
The Team
Annexus, a product development company, designed the Lifetime Income Builder annuity at the heart of the new funds.
Nationwide's Nationwide Fund Advisors division is the official fund family investment advisor.
Nationwide Life Insurance Co., an affiliate of Nationwide Fund Advisors, is writing the annuity. It joined with Annexus to introduce the contract in February.
A separate company, Global Trust Co., is the trustee of the collective investment trust. Global Trust has fiduciary authority over the trust investments.
Capital Group, the fund family giant on the team, is the fourth biggest fund family in the United States, with about $2 trillion in assets under management.
